ASX drops from record as energy giants, CBA fall

The Australian sharemarket fell from a record high on Tuesday following declines in energy prices and more tariff blustering from US President-elect Donald Trump.

The S&P/ASX 200 index dropped 58.2 points, or 0.7 per cent, to 8485, slipping from a record close set at the start of the week. Energy stocks were the largest drag on the index, falling 3.1 per cent. Woodside dropped 3.8 per cent to $24.40 and Santos slipped 4.2 per cent to $6.57.

The falls in the energy giants tracked a lower oil price following reports that a ceasefire was imminent between Israel and Hezbollah that would halt fighting for 60 days. The sign of emerging stability in the oil-rich region sent Brent crude down 2.8 per cent overnight on Monday, before steadying just above $US73 a barrel in Asian trading on Tuesday.

Energy and banks extended early losses after Trump posted on his social media platform that he would impose a 10 per cent tariff on Chinese goods, and a 25 per cent tariff on Canadian and Mexican goods in reaction to what he claimed was the influx of narcotics and illegal migration from those countries.

“Markets today received a glimpse of what lies ahead under Trump 2.0,” said IG analyst Tony Sycamore.

Shares in Commonwealth Bank extended earlier losses to end the session down 3.6 per cent to $154.46, after setting an intraday record on Monday. Westpac, ANZ and National Australia Bank fell more than 1 per cent.

Contrary to the decline in the Australian sharemarket, however, Chinese equity benchmarks climbed. The CSI 300 rose 0.4 per cent and Hong Kong’s Hang Seng added 0.5 per cent.

“Today’s announcement could be interpreted as risk-positive rather than negative,” Sycamore said, noting that his view was contrary to the downward move on the ASX.

“A 10 per cent increase in tariffs on China would place the average tariff rate at 27 per cent, which is significantly lower than the 60 per cent he threatened during his campaign and well below the consensus of 40 per cent.”

The combination of a stronger US dollar and waning demand for haven assets as ceasefire talks progressed also sent gold lower, which flowed through to ASX miners. Emerald Resources fell 3.5 per cent to $3.58 and Bellevue Gold dropped 2.7 per cent to $1.26.

Stocks in focus

Traders contemplating higher tariffs on US imports bid up prices of ASX-listed US suppliers. BlueScope Steel, which operates in the US, added 5.6 per cent at $22.43 and plumbing supplier Reece rose 2.2 per cent to $25.57.

Market operator ASX Ltd announced that it would implement the final iteration of its settlement system upgrade in 2029 and told investors the price tag of the new system would probably be at the top end of its guidance. The shares lost 4.3 per cent at $66.18.

WiseTech rose 1.4 per cent to 124.40, buoying the local tech sector, following a note from analysts at Morgan Stanley, who reiterated their buy rating on the stock, saying the shares could rise as high as $200 apiece in their most bullish scenario.

Global payments provider EML Payments soared 29.2 per cent to 88.5¢ after underlying earnings increased by 46 per cent in the first quarter of FY25.

Ramsay Healthcare was 3.5 per cent higher at $39.35 after outgoing chief executive Craig McNally told the investors at the company’s annual general meeting that the business had recorded a positive start to FY25 despite a slower growth outlook for the healthcare network.